The UK construction sector experienced its most rapid growth in nearly two and a half years, according to the latest purchasing managers’ index (PMI).
- The S&P Global UK Construction PMI rose to 57.2 in September, marking the seventh consecutive month above the growth threshold.
- Civil engineering led the growth with a notable index of 59.0, while commercial building and house-building sectors also performed well.
- Employment levels improved, supported by increased workloads and recruitment, despite persistent cost pressures.
- Business optimism remains high, driven by a stable economy and government initiatives, although concerns over steel prices and input costs persist.
The UK construction sector is basking in its most impressive performance in nearly two-and-a-half years, as revealed by the latest purchasing managers’ index (PMI) data. The headline S&P Global UK Construction PMI recorded a substantial rise to 57.2 in September, up from 53.6 in August, sustaining its position above the neutral 50.0 mark for a formidable seventh month in a row.
The detailed analysis of sub-sectors highlights civil engineering as the standout performer, with its index reaching a robust 59.0. Not to be outdone, commercial building achieved its highest score of 55.2 since May 2024, while house-building’s index climbed to 54.3, its best since March 2022.
New orders within the construction industry expanded at their most vigorous pace for two-and-a-half years, instigating a flurry of recruitment efforts intended to address the burgeoning workloads. While some firms reported delays in replacing staff due to cost constraints, overall employment levels saw beneficial gains across four of the past five months.
The demand for construction materials continued to rise solidly, although some concerns about steel supply and pricing emerged. Notably, suppliers’ delivery times decreased in September, a development linked to growing vendor inventories. Input costs, meanwhile, have experienced a significant increase, with rates charged by subcontractors witnessing only a modest rise, reflecting the complexities of the current economic landscape.
Despite these challenges, the outlook for business activity remains optimistically positive, with expectations of sustained growth driven by house building sector prospects. Tim Moore, Economics Director at S&P Global Market Intelligence, stated, “A combination of lower interest rates, domestic economic stability, and robust infrastructure pipelines has invigorated order books.” This sentiment is echoed by industry professionals who foresee a strong finish to the year, aided by government interventions, such as the anticipated outcomes of the National Planning Policy Framework (NPPF) consultation.
The UK’s construction sector is poised for sustained growth, bolstered by stable economic conditions and robust infrastructure projects.
